MME2

• Franchising is a form of business by which the owner (franchisor) of a product, service or method obtains distribution through affiliated dealers (franchisees).
• franchisor/franchiser

  The person or company that grants the franchise the right to do business under their trademark Or tradename.
• franchisee

  The person or company that gets the right from the franchisor to do business under the franchisor to do business under the franchisor's trademark or tradename and benefits from it.
• Two parties to franchisinG ARE Franchisor or franchiser AND Franchisee
• The five (5) major types of franchises:

  1. Job franchise

  2. Product franchise

  3. Business format franchise

  4. Investment franchise

  5. Conversion franchise
• Job franchise is a home-based or low investment franchise that is taken by a person who wants to start and run a small franchised business alone.
• A product (or distribution franchise are base on supplier-dealer relationship, where franchise Distributions the franchisors products.
• business format franchise

  Gets the entire system to operate the business and market the product and/or service
• investment franchise

  There are large scale projects which require a large capital investment, such as hotels and larger

  Restaurants. The franchises usually invest money and engage either their own management team or franchisor to operate the business and produce a return on the investment and capital gain on exit.
• Conversion franchise is a modification of standard franchise relationships. Many franchise systems grow by converting independent business in the same industry into franchise units. The franchises adopt trademarks, marketing and advertising programs, training system and critical client service standards.
• Key points to consider IN FRANCHISING:

  1. Franchise fee and annual royalty percentage.

  2. Your franchise agreement term and renewal conditions.

  3. The geographic areas you will go into and the specific territory rights for each franchise.

  4. The amount of start-up and ongoing training you will provide.

  5. Whether franchisees must buy products or equipment from your company.

  6. The qualifications, experience, and financial standing you want in a franchise.

  7. How you will market and sell your franchise.
• Franchise fee is the payment given to the franchiser for joining the network. It can be seen as an entry fee paid for the secrets of the business.
• Royalty fee represents the amount the franchise pays the franchiser every month (or whenever agreed) for commission of its sales. In return, the franchiser provides continuous training, market studies and release of new product.
• Two main types of franchising

  1. Product distribution franchise

  2. Business format franchise
• • product distribution franchiseis franchised that simply sells the products of the franchisor and have supplier-dealer relationships.
• business format franchise- is type of franchise includes not only the product, service and Trademark but also the complete method of conduct the business itself, such as the marketing plan and operational manual.
• BUSINESS PLAN TITLE : GLOBAL TASTE HUB: Bridging Culinary Traditions from Around the World